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406 F.

2d 590

E. E. MILLER, Appellant,
v.
Ira MILLER, Appellee.
No. 9726.

United States Court of Appeals Tenth Circuit.


Jan. 31, 1969.

Sam Laughlin, Jr., Roswell, N.M. (Robert J. Laughlin, Roswell, N.M.,


with him on the brief), for appellant.
Charles C. Spann and Michael G. Sutin, Albuquerque, N.M., for appellee.
Before LEWIS, SETH and HICKEY, Circuit Judges.
HICKEY, Circuit Judge.

This appeal is from a judgment cancelling a warranty deed on the grounds that
there was a conditional delivery of the deed which was an attempted
testamentary disposition in contravention of the statutes of the State of New
Mexico.

The issues raised by appellant are directed to the factual determinations that the
delivery of the deed was conditional and therefore not complete; that the
delivery was an attempted testamentary disposition contra to the statutes of the
State of New Mexico; and that the action should have been dismissed because
of the failure to join indispensable parties.

F. A. Miller, a pioneer stock raiser in the State of New Mexico fathered four
sons. One of the sons, E. E. Miller, the appellant herein, carried on in the
ranching business with his father. Ira Miller, appellee herein, is the youngest
son, a resident of the State of Colorado and a devisee under his father's will
admitted to probate. Ulric Miller, a resident of New Mexico, was named
executor in the will and was permitted to intervene in this action in his position
as executor. Yule Miller, a fourth son residing in New Mexico, is a legatee
under the will. Joetyne Miller Wright, the daughter of E. E. Miller, who resides

in New Mexico, took the remainder after the life estate devised to her father by
the will.
4

During his lifetime F. A. Miller executed four wills. The first was a joint will
executed in 1936 wherein F. A. Miller and his wife agreed that the survivor
would distribute the property among the sons. After the wife's death in 1937, F.
A. Miller executed a will distributing the property to the sons. In 1946 a third
will was executed which distributed the real property to three of the sons. E. E.
Miller was given a life estate in certain real property by this will, and his
daughter, Joetyne Miller, took the remainder in fee. The fourth son was
bequeathed $2,000 in cash. The will provided the real property would not be
sold for twenty years after the father's death. In 1952 the last will was executed
eliminating the twenty year restriction of sale and including another
remainderman.

The 1946 will was admitted to probate and its validity was upheld by the
Supreme Court of New Mexico.1 Letters testamentary were accordingly issued
to Ulric, the named executor, who forthwith intervened in this action. Ulric
died during the pendency of this appeal and the appellee, Ira, has been
substituted as executor.

F. A. Miller died on April 11, 1965. Prior to his death, however, he had
executed a warranty deed which purported to pass in fee all the property in
Lincoln County, New Mexico, to his son, E. E. Miller. The property conveyed
by this deed included the land that had been devised to Ira Miller in the 1946
will and the land that had been devised to E. E. Miller for life with remainder to
Joetyne in the same will.

After the 1961 deed had been executed and notarized, E. E. Miller transmitted
it to J. Benson Newell, a lawyer and long time acquaintance of F. A. Miller.
The lawyer held the deed in his possession until F. A. Miller died and then
recorded it. It is this deed which Ira now seeks to cancel.

The trial court cancelled the deed upon the grounds that there had not been an
unconditional delivery to the lawyer and that it was an attempt to make a
testamentary disposition contra to New Mexico statutes. Unless these
conclusions in the trial court's memorandum are based upon findings which are
clearly erroneous, we cannot disturb them.2

The record reflects that E. E. Miller executed a deed, conveying contiguous


land he previously acquired, to F. A. Miller, his father, which was included in

the transmittal to the lawyer with certain directions.3 After this arrangement had
been made the record reflects that both F. A. and E. E. Miller continued to treat
the land in litigation as if it belonged to the father. In 1963 an easement was
granted covering the land in question signed by F. A. Miller by E. E. Miller
under a power of attorney. From this and other evidence the trial court found
that F. A. Miller retained control and possession of the property. The New
Mexico Supreme Court has said that '* * * where (a) grantor retains control and
possession of property described in a deed, intending there be no delivery
thereof until after his death, the fact that possession of the deed is in the grantee
and its recording was obtained by him, does not establish that title has passed to
him.'4
10

The findings of the trial court concerning incomplete delivery and attempted
testamentary disposition are supported by the evidence, and accordingly, we
cannot overturn the conclusions relating to these issues.

11

We turn now to the strenuously argued contention that the action should have
been dismissed for failure to join indispensable parties.

12

Ira Miller is a resident of Colorado and E. E. Miller, together with all the other
heirs, beneficiaries, legatees and devisees are residents of New Mexico. E. E.
Miller, appellant herein, contends that the heirs at law of F. A. Miller are
indispensable parties to this action to cancel the deed, and that if they are
joined, diversity of citizenship would be destroyed which is the sole basis for
the jurisdiction in the Federal District Court.

13

In order to determine this question, it is necessary to examine the land


described in the deed and find to whom it was devised in the 1946 will.

14

The common law rule relating to the passing of title to real estate upon the
death of the owner is codified by N.Mex. Stat. 31-7-2 (1953). 'The real estate of
a decedent shall pass directly to the heirs or devisees and not to the executor or
administrator.'5

15

The will discloses that the property described in the deed was devised to Ira
Miller and E. E. Miller with a remainder to Joetyne Miller Wright. According
to the above statute no interest in or to the property described in the deed could
have vested in any other persons at the time of F. A. Miller's death because it
passed directly to them as devised property.

16

E. E. and Ira Miller were therefore the only parties indispensable to the

determination of the ownership of the real estate.


17

There remains, however, the possible issue of whether or not Joetyne Miller
Wright was indispensable as a remainderman. If the deed is valid as a
conveyance of title her potential remainder is cut off. However, if the deed is
invalid, her interest as a devisee under the will is restored. We examined
Fed.R.Civ.P. 19(b) in the light of the criteria established by Provident
Tradesmens Bank & Trust Co. v. Patterson,6 together with Bennie v. Pastor,7 in
order to determine this issue. As an appellate court we have the advantage of
examining the status of Joetyne after a judgment has been entered which has
given her an interest she otherwise would not have. The criteria set forth in the
above cited cases established Joetyne is not an indispensable party.

18

The question of whether or not the intervention of the executor, Ulric Miller, a
resident of New Mexico, destroyed diversity must now be considered. As
indicated above8 an executor has no interest in or ownership of titl under New
Mexico law. Therefore, Ulric Miller, as executor, could have no interest which
would require his joinder as an indispensable party. Executors are not
indispensable parties in actions such as this9 and therefore the intervention of
such a party cannot destory diversity jurisdiction.10

19

Affirmed.

Galvan v. Miller, 79 N.M. 540, 445 P.2d 961 (1968)

Glens Falls Ins. Co. v. Newton Lumber & Mfg. Co., 388 F.2d 66 (10th Cir.
1967)

'Hollywood N.M. March 2-- 1962. Mr. J. Benson Newell, Las Cruces, N. Mex.
Dear Mr. Newell, Enclosed Bill of Sale and Deed of mine which I want you to
keep and give to Dad if something happened to me first. Also is another Deed
made to me personally leaving out all others which he wants, Keep this and
return the other Deed you have of his, Please send it Registered Mail Deliver to
Addressee Only to Fount A. Miller Hollywood N. Max. With Kindest personal
regards Bro, E. E. Miller P.S. The dollar is for postage on return letter.'

Martinez v. Archuleta, 64 N.M. 196, 326 P.2d 1082, 1084 (1958)

See Conley v. Wikle, 66 N.M. 366, 348 P.2d 485 (1960)

390 U.S. 102, 88 S.Ct. 733, 19 L.Ed.2d 936 (1968)

393 F.2d 1 (10th Cir. 1968)

N.M.Stat. 31-7-2

2 Barron & Holtzoff, 513.5, p. 122 (Rules ed.1961); Hale v. Campbell, 127
F.2d 594 (8th Cir. 1942); Conley v. Wikle, 66 N.M. 366, 348 P.2d 485 (1960)

10

Wichita R.R. & Light Co. v. Public Utilities Commission, 260 U.S. 48, 43 S.Ct.
51, 67 L.Ed. 124 (1922); Black v. Texas Employers Ins. Ass'n, 326 F.2d 603
(10th Cir. 1964)